Overview
The Parliamentary Standing Committee on Health and Family Welfare presented its report titled 'Affordability and Accessibility of Healthcare Facilities in Public and Private Sector' to Parliament, flagging a critical healthcare coverage gap affecting over 40 crore Indians.
The 40-Crore 'Missing Middle' Coverage Gap
- Over 25% of India's population (more than 40 crore individuals) lacks financial risk protection
- This group sits just above the poverty line, making them:
- Ineligible for government-subsidized schemes like Ayushman Bharat PM-JAY
- Unable to afford commercial health insurance
- Often termed the 'missing middle' - excluded from both public subsidies and private coverage
Key Findings of the Report
Private Sector Dominance
- Private sector accounts for more than 60% of inpatient care
- Private sector handles 70% of outpatient care
- Households without health safety nets are fully exposed to commercial pricing
Primary Financial Risk
- The main threat is not catastrophic hospital admissions alone
- Rather, the slow erosion of household income through recurring outpatient costs:
- Medicines
- Consultations
- Diagnostic tests
Escalating NCD Burden
- Rising prevalence of chronic conditions:
- Diabetes
- Hypertension
- Cardiovascular diseases
- Has converted outpatient care and medication into lifelong recurring expenses
Stark Cost Disparities
| Healthcare Service | Private Sector | Public Sector | Disparity |
|---|---|---|---|
| Childbirth | Rs 37,630 | Rs 2,299 | 16x higher |
High Pharmaceutical Costs
- Medicines constitute nearly 30% of India's health expenditure
- Retail pharmacy distortions:
- Unregulated trade margins
- Over-the-counter antibiotic sales without prescriptions
Public Health Underfunding
- Government health spending: 1.43% of GDP
- National Health Policy 2017 target: 2.5% of GDP by 2025
- Health expenditure share in total government spending:
- 2021-22: 6.12%
- 2022-23: 4.89% (below pre-pandemic 5.02% in 2019-20)
Insurance Model Limitations
- Private policies enforce:
- High premiums
- Extensive waiting periods
- Co-payments
- Disease exclusions
- Disproportionately cover secondary and tertiary hospitalization over primary/outpatient care
Universal Health Coverage (UHC)
UHC ensures everyone has access to quality essential healthcare services without financial hardship, covering:
- Promotion
- Prevention
- Treatment
- Rehabilitation
- Palliative care
India's Health Coverage Landscape
Current Coverage Framework
- Ayushman Bharat PM-JAY: Covers bottom 40% of population
- 2024 Expansion: All citizens aged 70+ covered (Ayushman Bharat Vay Vandana)
- 45.5 crore Ayushman Cards issued by August 2026
Key Health Initiatives
- Ayushman Vaya Vandana
- Employees' State Insurance Scheme (ESIS)
- Central Government Health Scheme (CGHS)
- National Health Mission
- PM-Bharatiya Janaushadhi Pariyojana
Key Recommendations
1. Prioritize Public Capacity Over Insurance
- Build public healthcare capacity directly
- Regulate prices of procedures in private hospitals
- Prevent exploitation of uninsured 'missing middle'
2. Promote Generic Medicines
- Mandate prescription by generic names
- Stock full essential drug list at every public facility
- Strengthen audits on trade margins
- Enforce prescription-only antibiotic sales
3. Establish Public Health Management Cadre
- Create dedicated management cadre
- Free clinical specialists from administrative duties
- Optimize public hospital operations
4. Nationwide Enforcement of Clinical Establishments Act
- Universal implementation of Clinical Establishments Act, 2010
- Mandate standard treatment protocols
- Enforce quality standards
- Ensure price transparency across private hospitals
5. Outpatient-Centric Protection Frameworks
- Evolve beyond hospitalization-only coverage
- Incorporate:
- Outpatient care
- Diagnostic subsidies
- Chronic disease management
- Prevent medical impoverishment through everyday healthcare costs
Constitutional and Legal Provisions
- Clinical Establishments (Registration and Regulation) Act, 2010: Framework for registration, standards, and price transparency
- National Health Policy 2017: Commits to progressive increase in public health expenditure to 2.5% GDP
- Directive Principles: Article 47 (State obligation to improve public health)
Conclusion
India's path to Universal Health Coverage requires more than hospitalization insurance. Standardizing healthcare costs through the Clinical Establishments Act and expanding primary/outpatient services are key to protecting the 'missing middle' from medical impoverishment.
Drishti Mains Question
"India's healthcare challenge is increasingly one of financial protection rather than merely physical access." Examine in the context of the 'missing middle'.